What to do...what to do...

I’m not sure if this belongs in this post…but I’m just beginning…so I have to start somewhere!

I have a home in Vegas that I live in. I want to sell it sooner rather than later. I used the equity in the home to pay off my credit card debt and now I have a mortgage that equals what the home is worth today. I’m hoping to sell the house at $310K, but am willing to shell out another 10k out of my pocket if I have to sell at $300K. I would rent it out, but my payments are $2500/month and as a rental in Vegas, I wouldn’t get more than $1400. Can I offer a better option for financing or selling? Like a contract on sale or lease option…would that make sense?

My plan is to sell and start over. Rent for $1500 a month instead of paying $2500 on a mortgage. And use the $1000 per month to save up and start investing in multi-family properties (out of state).

Thanks for your advice. I’m under 30 and want to have my first investment property by the time I hit 30…and I don’t think it’s going to happen with me paying $2500 a month on my primary home!

Your in between a rock and a hard place. Is your area still appreciation rapidly like most of Vegas? If it is, I’d hang on to the house for a while suffering through the $2,500 payments until you gained some equity. Then I’d use that $10k your willing to lose, for a down payment on a rental property so that cash flow can offset some of your mortgage payments. Since you’ll be buying that rental property at a steep discount and with the appreciation of Vegas, soon you’ll have enough equity to buy a multifamily property.

Hope this helps.

Thanks for the advice!

Vegas isn’t appreciating, it’s in a stand still at the moment. That’s my worry, that if I do really need to sell in the next year I will have lost my opportunity to sell for what I need to pay off the mortgage. But Vegas is a strange market and you never really know what it will do from here.

In terms of buying an investment property that cash flows here in Vegas, it’s pretty much non existant since the rental market is still rather cheap. Everyone I know is upside down on their rentals.

sell it to a seller on a contract for deed, get a sizable down pmnt w/no credit check/no qualifying for a loan, set your purchase price for 2 yrs out, and make their pmnts $100 or so higher than yours.


In theory, your suggestion is a good one to sell with a contract for deed. However, in the real world the majority of “buyers” with lease options and contract for deed deals never buy the property. The reason that they are forced to buy on lease option or contract for deed (with no qualifying) is that they make bad choices in their lives and will continue to do so. Typically, they go for a year or two before the deal falls apart. However, once the deal goes bad, they often have failed to pay the taxes and insurance; have not done the maintenance; and have trashed the house. As with a lot of the GURU strategies, it is simply NONSENSE!


I would watch the days on market (DOM) for your area. If the DOM start increasing significantly, I would sell as quickly as possible. I believe that we are a long way from the bottom of this real estate bust. DOM usually increase significantly just before the prices begin to drop. Also, if the rental market is not good in Vegas and you want to be a REI, then I would move.

Good Luck,



Thanks for the advise. I think DOM is typically 60 days if they’re priced right. I think

Vegas is definately NOT a good rental market, especially not now (it might be if you bought before 2004). But I can’t move out of Vegas for another year (I’ve already thought about it!!)…so I’d like to purchase an investment property or two (probably a duplex) out of state. I’m currently looking at UT or TX.


I wouldn’t have a clue what the so-called gurus say about CFDs, as I’ve never bought a book, attended a course, boot-camp, or anything else about them. But my “real world” experience, with my own properties, tells me just the opposite.

I think a Contract For Deed, Land Contract, Installment Sale, or whatever you want to call it, can be an excellent way to go.

I’ve only done a few this way, but I have found that people who put a good amount of money down not only take good care of their home, they fix it up and enhance it. And they NEVER fail to pay taxes or insurance, because they’re not the one paying them. I am. It’s also important to remember, their payments are based on the purchase price, not the local area rents. Which eliminates any negative cash flow.

By the way, not everyone who buys on a LO or CFD does so because they made “bad choices in life.” There are a lot of very responsible people, who have made excellent choices in life, but who have had bad situations happen to them. In fact, that’s part of life.

Just my 2¢


I might suggest taking a closer look at a CFD, or Installment Sale. Keep in mind, it is just a means of owner financing. So, it’s an actual sale. It’s not just an option for someone to buy.

And offering to sell with owner financing can sometimes give you the edge you need in a slower market. It can also help ensure receiving full market value. Which, in your case, it sounds like you need to do.

It’s just something else to consider.


You seemed to have taken my post very personally, I’m not sure why, as you weren’t even one of the earlier posters. At any rate, when you have only done a “few” of anything, your personal experience may or may not be very meaningful. I’m not against you or Andrea or anyone else doing lease options, CFD, or any other technique. In fact, what you do is none of my business and quite frankly I don’t care what you do. The purpose of my post was to simply point out the realities of lease options and CFDs as opposed to the hype.

I have and continue to do lease options, but in my opinion and experience is that the “buyers” do not actually buy the property in the end. Whether it is a lease-option or CFD, the “buyers” are by definition in a very high risk group which is why they can not get a bank loan. With the very loose underwriting requirements of the past few years, that speaks volumes to me.

I certainly have not done enough of these deals to make my personal experience any more valid that yours is. I am really in the rental business. However, I have many friends who are successful investors and their experience is similar to mine. That experience is that these “buyers” are really nothing more than renters. They do all the same stupid things that all renters do. In addition, while you are waiting for a “buyer” to come along that has terrible credit but a big pile of cash (rare) for the downpayment or lease option premium, you could have simply rented the property. The lost rent during the wait for the “buyer” often offsets any benefit that you get from the downpayment or lease option premium.

Finally, I’m not understanding your comment that their payments are “based on the purchase price, not local area rents. Which eliminates any negative cash flow.” That is simply wrong. Rents are higher than mortgage payments. Otherwise, the owners of rental property would always have a massive negative cash flow. If you meant to say that because the “buyer” is purchasing the house, there can be no negative cash flow, I agree in principle. However, if they don’t buy the house (normal); if they don’t pay their bills; don’t do the maintenance; trash the house when they leave; and don’t pay the taxes and insurance, then you certainly can have a LOT of negative cash flow. Does this happen in every case? No. Does it happen all too frequently? YES! In addition, with CFDs, many states require that you foreclose on the property when certain conditions are met. That greatly increases the loss with many months of lost income, legal fees, court costs, etc.

Again, I’m not saying that you should never do lease options or CFDs, but at least realize what the realities are.


Greetings Mike,

No, I didn’t take anything personal. I was just defending the potential use of CFDs as a viable option for Andrea.

Again, I have no idea what the gurus say about them, or what their hype is. But like any tool, I believe there are times when a CFD can be a great way to go. And in her case, I feel it should at least be considered.

As I’m sure you know, a Lease Option and a CFD are two completely different animals – contractually, legally, and everything else. And because of those differences, I do NOT view them the same as a Lease Option. I put CFDs in the same category as an AITD, a wrap, a carry-back, or any other form of seller financing. And as a result I don’t look at the buyers as glorified tenants. Nor would I ever qualify them the same way.

I do loans all over the country and could come up with a whole list of reasons why someone may not be able to get loan. Reasons that have nothing to do with them having terrible credit, or being the type of renter that trashes everything, or doesn’t pay their bills. And there are times when a CFD would work quite well these types of people.

Sorry if I wasn’t clear before. My comment about payments being based on purchase price was referring to selling a property on a CFD (not a Lease Option). Again, a Contract for Deed constitutes a sale, which means the payments are based on the purchase price – regardless of what local rents may or may not be. And in CA where I’m located, or NV where Andrea is, that can be a huge difference.

For example, a house here that might have a PITI on a CFD of $2,500/mo may only rent for $1,500/mo. Which obviously wouldn’t work to put a renter in. Which is also what I meant when I referred to eliminating negative cash flow using a CFD.

And in Andrea’s case, where she’s maxed out her equity, and is in a market that rents would not cover her existing payments, a CFD just gives her another option in selling. And it may even give her an edge over other properties for sale in her area.

I’ll say it again, when used right, I think CFDs can be a great tool. Not a strategy, but a tool.

And thank you for sharing a different viewpoint, Mike. Or, should I say, sharing other things for people to consider.

it’s been my experience that some folks can’t get a loan because of a recent job or career change, relocation and not long enough time a resident, recent new business owner/startup under 2 yrs, the list can go on.

if someone buys on a CFD, they are putting down sizable $, so the odds of them trashing the house are not high. and the odds of them buying it outright are high. if they don’t you can repeat the process with a new buyer, with a new price, more DP $, and another 2 yrs.

i know of a guy that did it 3 times with $30k down each time, and for some reason each buyer never completed the sale at the end of 2 yrs. finally when he sold it the 4th time and they bought it outright at the end of the CFD, it broke his heart, there went an easy $30k a year for him!

Thank you so much for all the advise, I really appreciate everyones time. I think the CFD sounds like my most viable option at the moment. Even with the risk…I just don’t think I can afford the realtor fees of selling conventionally.

So does anyone have any suggestions on how to start the process? I will list it on Craigslist most likely asking $315K with $9000 down payment…? But what is my next step if anyone is interested?